A report by the Institute of Chartered Accountants in England and Wales (ICAEW) has predicted that the growth of African Financial Technology sector will be worth $3 billion by 2020 with key players in Kenya, Nigeria, and South Africa.
The report states that most African countries have a positive economic outlook led by East Africa attributed to the positive performance of traditional sectors.
“East Africa is likely to remain the strongest growing region with a 6.3% economic expansion while Ethiopia, Ethiopia, Rwanda, Tanzania, and Uganda may record real GDP growth above 6% this year,” the report noted.
The growth has been attributed to infrastructure investment and the expansion of financial and telecoms services.
Michael Armstrong, Regional Director, ICAEW Middle East, Africa, and South Asia, however, says that fintech is likely to provide an opportunity for most African countries to leapfrog other key drivers and to foster inclusive development only when it is managed properly.
“African economic growth is currently driven mostly by traditional sectors. It is increasingly receiving attention from both private and public sector, facilitating innovation in other areas of the economy and allowing countries to move from more traditional infrastructure,” he said.
The report added that the growth of FinTech facilitates innovation in other sectors of the economy and which provides social and developmental benefits mainly in the banking and insurance sectors.